In 1891 the Grand Trunk Railway opened the St. Clair Tunnel at Port Huron, giving it an advantage over the Canada Southern and its car ferries. The Detroit River Tunnel Company was formed August 15, 1905 as a merger of the Michigan and Canada Bridge and Tunnel Company (in Michigan) and the Canada and Michigan Bridge and Tunnel Company (in Ontario). Construction began in October 1906 under the engineering supervision of The New York Central Railway's engineering vice president, William J. Wilgus. The Michigan Central Railway Tunnel opened for passenger service July 26, 1910. Freight service began September 15 and on October 16 all traffic began running via the tunnel, ending the use of a train car ferry. From opening it was operated by the Michigan Central Railroad under lease of December 19, 1906. It was the first immersed tube tunnel to carry traffic.

On the east (Canadian) side, the tunnel connected to the line that had served a train ferry at Windsor. On the west (U.S.) side, the tunnel connected to the Michigan Central Railroad main line west of downtown (later abandoned east of the junction), and the Michigan Central Station was built west of the junction, opening in 1913.

In 2010, The Windsor Port Authority, Borealis Infrastructure, and Canadian Pacific announced plans to construct a new rail tunnel compatible with double stacked trains. The initiative is known as the Continental Rail Gateway. The project was scrapped in 2015, upon the approval of the proposed Gordie Howe International Bridge.[5]